ROLAND Avante, a treasurer at Chinatrust (Philippines) Commercial Bank, comments on the outlook for the Philippine peso and interest rates.

The peso weakened for a sixth day, its longest losing streak in 10 months. The currency lost 0.96 percent to P41.595 per dollar, according to the Philippine Dealing and Exchange Corp.

“Global developments and the winding down of the carry trade are affecting regional currencies, including the peso.’’

“The peso will continue to trade in aberration because of global risk aversion. The underlying fundamentals of the currency and of the Philippine economy haven’t changed.’’

“Some people are finding P41.50 to the dollar a good level to reinstate their position.

“We’re still enjoying inflows from remittances, although they’re not as substantial as the November-December level. There’s also an inflow from call centers.’’

The peso “can drop to P41.60 to P41.70 but can go back to 41 or even stronger once the Fed moves.’’

On US and Philippine interest rates:

“What’s crucial in the next couple of days is how the Fed would react. The markets are sending a signal for the Fed to cut and to cut in a big way. A 50-basis-point cut is a certainty. Some are already speculating on 75 basis points.’’ A basis point is 0.01 percentage point.

“Everybody’s waiting for the move that will have a calming effect on the markets.’’

“In the Philippines, I think a 25 basis-point cut is also a certainty. The question is, until when can the central bank keep this pace. Inflation is becoming a concern.’’

US policymakers next meet to review interest rates on January 30. The Philippine central bank meets the next day. 

HEADSTRONG, the information technology services and consulting company, said it is expanding its operations in the Philippines, because of growing opportunities in the outsourcing and offshoring industry (O&O) as well as increased interest by clients.

BIR may hurt preneed firms on higher VAT

THE Philippine Federation of Pre-Need Plans Companies Inc. (PFPPCI) said a proposed tax increase by the Bureau of Internal Revenue (BIR) would hurt the industry and eventually push companies to close shop.

DESPITE its acquisition of the Philippine National Oil Co.-Energy Development Corp. (PNOC-EDC) and a planned expansion program, First Gen Corp. said it is within the prescribed ceiling of 30 percent of a grid and 25 percent of the national grid under the Electric Power Industry Reform Act (Epira).

SHANGHAI AND TOKYO—Asian stocks Tuesday plunged, sending the regional benchmark to its biggest decline since April 1990, on concern the global economy is faltering.

ROLAND Avante, a treasurer at Chinatrust (Philippines) Commercial Bank, comments on the outlook for the Philippine peso and interest rates.